Two Megafabs are to produce Intel computer processors in Magdeburg from 2028. It would be the largest foreign investment in Germany, at least since World War II. But now it’s about the money. Intel sees enormously increased costs, not least due to the high construction and energy costs in Germany. At the same time, significantly higher subsidies beckon in the USA than the 6.8 billion euros in grants for Intel that Germany and the European Union have been offering so far.
The construction of the semiconductor factory was originally supposed to cost 17 billion euros. In the meantime, the forecast construction costs for the Magdeburg Fab have allegedly risen to 30 billion euros. Unsurprisingly, Intel wants to get a lot more funding. Under the current circumstances, Intel does not consider the chip factory to be competitive and has postponed the start of construction for the chip factory in Magdeburg to 2024 at the earliest. This means that the first chips made in Magdeburg cannot be expected before 2028.
If built at all. Because the German side was initially not impressed by Intel’s desire for higher subsidies. Instead of direct subsidies, the state government of Saxony-Anhalt considered building new wind turbines in order to be able to offer Intel cheaper electricity.
Germany hopes for a compromise
However, Berlin and Magdeburg naturally want Intel’s fabulous fab investment – even more so if it is higher. So now things are moving, reports the Financial Times. “It is logical that if the scale of investment increases, the level of subsidy will also increase,” the newspaper quoted Saxony-Anhalt’s Economics Minister Sven Schulze as saying.
“Intel has to meet us halfway,” she echoes the point of view of an unnamed German official. So the door is open for more state aid, but maybe not quite as wide as Intel would like. Another prerequisite for the whole project is that the EU opens its cash box. This requires the planned European Chips Act, which is intended to transform the European semiconductor market.
The Magdeburg project runs under the name of Intel Silicon Junction and is primarily intended for manufacturing processes that are still under development, such as Intel 3, Intel 20A and Intel 18A. Intel 3 is an optimized 7-nanometer process, and the Intel 18A expected after 2025 is expected to compete with 2-nanometer processes from TSMC and Samsung. 18A stands for 18 angstroms, i.e. 1.8 nanometers.
(ds)
